M&S sells Brooks Bros at big loss

STORES group Marks & Spencer has sold its New York-based clothing chain Brooks Brothers for $225m (£153m) - less than a third of what it paid for the group 13 years ago.

US women's clothing chain Retail Brand Alliance has bought Brooks, which was put up for sale by M&S last March as part of chief executive Luc Vandevelde's three- year restructuring plan to restore the High Street group to its former glory.

RBA is controlled by Claudio Del Vecchio, son of Leonardo Del Vecchio, one of Italy's richest men and founder of Luxottica SpA which owns designer sunglasses maker Ray-Ban. It is little known on this side of the Atlantic but has 1,000 stores in the US, employing 10,000 people. It had sales of $900m and operates under several brand names including Casual Corner, a middle-price business suits and separates chain.

David Norgrove, M&S's international director, said: 'Brooks Brothers has a wonderful American heritage and a committed workforce but it was not a good fit with M&S's core business or strategic priorities.'

Brooks was established in New York in 1818 by Henry Sands Brooks. For generations it has dressed US Presidents from Roosevelt to Clinton in its formal English-style gentlemen'sclothing. Colourful blazers and muted shirts are its hallmark and movie stars from Clark Gable to Robert Redford have been among its customers. During the 1980s it expanded into women'sclothing as well.

M&S bought Brooks Brothers in 1988 in a blaze of publicity for $775m from Federated Department Stores. It then had an operating profit of $41.5m on sales of $290m. In the year to last March Brooks Brothers' operating profit had shrunk to $30m on sales of $661.1m.

It has 160 retail stores in the US and operates about 75 stores outside America. In 1988 M&S had plans to bring Brooks to the City to market its 'English style' clothes made in America.

But Brooks Brothers has been hit by the trend towards casual clothing, epitomised by the pop culture of the past 20 years. Upmarket men's clothing has been declining on both sides of the Atlantic. The change has been more dramatic in America than in Europe with sales of tailored clothing such as suits and sports jackets falling by 9% in a year.